The 14th China International Cement Industry Exhibition (Cementtech) took place in Beijing on 24-26 April, alongside the 2013 China International Cement Conference. These events, organised by the China Cement Association (CCA), provided a platform for equipment suppliers to demonstrate their latest technologies to more than 5000 delegates from across the country, and a forum for senior executives to discuss the next stage in the development of China’s cement sector. International Cement Review, which attended both events, sends this report from Beijing.

Jiang Minglin, consultant to the State Council

China’s cement sector will target increased efficiency and accelerate environmental initiatives as the industry moves from growth to sustainability. This was the key message delivered at the 2013 China International Cement Conference, which took place at the Hotel Nikko New Century in Beijing last April.
Opening the meeting, Qiao Longde, president of the CCA, highlighted some of the successes of the China cement industry, which in recent years has made dramatic strides in adopting more efficient production processes while eliminating backward production capacity.

“High-quality dry-process cement production now accounts for about 90 per cent of overall cement production, which has been realised through technological renovation and cement plant modernisation over the past 20 years,” explained Mr Longde.

Energy and emissions reduction

Nevertheless, the industry is still an enormous consumer of energy and, because of its sheer scale, is responsible for high levels of pollution.

Mr Longde said that the key short-to medium-term objectives of the industry, therefore, will be energy saving and emissions reduction. This can be achieved by driving forward technological innovation and developing a “second generation of dry-process kiln technology”, he said.

Overcapacity

Also speaking to delegates, Jiang Minglin, consultant to the State Council, warned that in spite of the industry’s noted achievements, its current rate of expansion is unsustainable, and has resulted in conspicuous overcapacity. “In 2012, annual cement production reached up to 2.18bnt, up 7.4 per cent YoY.“ Even though in 2012, outdated cement production lines amounting to 220Mt of capacity were phased out, 125 greenfield lines were built with clinker production capacity amounting to 160Mt. Thus, total national cement production capacity reached 3bnt and capacity utilisation rates slipped to 72.7 per cent.”

Therefore, in line with the development goals set out by the 18th National Congress of the CPC, the development mode of the cement industry will be switched from one of “scale expansion” to one which promotes technology advancement and prioritises environmental sustainability.

State controls will be actively introduced to resolve the issue of overcapacity. “We will bring market mechanisms into full play, focus on market demand, strictly control total output and give priority to the resolution of the issue of overcapacity,” said Mr Minglin.

Chinese cement sector performance

Kong Ziangzhong, secretary general of the CCA, reviewed the performance of the Chinese cement industry, noting that 2012 was a turning point, with annual cement production growth falling to 5.74 per cent, ending a decade of double-digit YoY growth. “The decreased rate of GDP suggests that a period of slow growth lies ahead for China cement production.”

Investment into the industry fell for a second year in a row in 2012, by 6.95 per cent to CNY137.9bn (US$22.4bn). Nevertheless, cement capacity is expected to increase around 7.5 per cent in 2013, while demand will only rise by six per cent, reinforcing fears of overcapacity. Meanwhile, as average prices dropped to the lowest level in four years, producer margins contracted.

More than 400 delegates listen to presentations at the China International Cement Conference

Industry consolidation remains the main government strategy for reforming the industry. In January 2013, the central government issued ‘Guidelines for Promoting Merger and Acquisitions in Key Sectors’, which proposed that “by 2015, the top 10 cement enterprises’ industrial concentration ratio should be 35 per cent, and 3-4 large enterprises having the clinker capacity of over 100Mta,” said Mr Kong.

 

Technical innovation and the universal adoption of ‘green’ technologies will also be accelerated from 2013 onwards, including initiatives to tackle quarry biodiversity, SNCR, SCR, low-nitrogen combustion, waste co-processing, CO2 emission reduction, pollutant monitoring and control, and energy saving. “A greener Chinese cement industry will be the fortune for the whole world,” proclaimed Mr Kong.

Conference papers

Also addressing the meeting were Philippe Fonta and Howard Klee of the Cement Sustainability Initiative (CSI), who in addition to encouraging Chinese cement producers to engage with the CSI, also stressed the importance of properly managing quarry biodiversity as part of the wider sustainability discussion.

Two other presentations of note focussed on long-term opportunities for carbon dioxide capture, storage and utilisation in the cement industry. Dennis Best, energy analyst at the International Energy Agency, described the key role that carbon capture will have to play in cutting global carbon dioxide emissions by 50 per cent by 2050 after atmospheric CO2 levels have doubled over the last 40 years. To achieve this, an estimated US$3trn will have to be invested. The implications for China, which produces and consumes over half the world’s cement, is clearly significant.

In answer to this challenge, Leslie Cheng-yun Koo, chairman of the Taiwan Cement Group (TCC), reported on the status of the world’s largest carbon dioxide capture pilot demonstration plant. Using a process known as ‘calcium looping’, the demonstration plant is currently able to reduce carbon dioxide emissions at a rate of 1tph at the Heping cement plant, and aims to increase this to 15tph by 2016.

Exhibition

The 14th China International Cement Industry Exhibition ran in parallel to the conference and was once again held at the Beijing Exhibition Center. This cement equipment exhibition included over 250 exhibitors and an attendance estimated at 5000 visitors over the three days, according to the organisers.
The large global turnkey equipment suppliers were out in full force, including Sinoma (China), China National Building Materials (CNBM) and its various subsidiaries, KHD Humbolt Wedag (Germany) and FLSmidth (Denmark), which last year tripled its manufacturing capacity in China with the inauguration of new state-of-the-art manufacturing facilities in Shandong.

Leading equipment manufactuer, Sinoma, exhibiting at the Beijing event

Spread across three halls, the complete range of cement manufacturing technologies was represented, from quarry and bulk handling technologies through to grinding, pyroprocessing, storage and distribution. Aside from the turnkey giants, the majority of exhibitors were focussed on supplying the domestic market, and in addition to local companies, there was a strong participation by European suppliers in every equipment category.

 

Article first published in International Cement Review, June 2013.